Corrections or additions?
d
This articles by Barbara Fox were published in U.S. 1 Newspaper on September 29, 1999. All rights reserved.
Martin A. Amstrong: Princeton Economics International
Last week Martin A. Armstrong, the once high-flying
investment guru now accused of defrauding investors of nearly $1 billion,
found himself in yet another skirmish with regulatory authorities.
He tried to declare Princeton Economics International, which has its
headquarters at 214 Carnegie Center, bankrupt in the court of West
Indies.
Federal prosecutors thought they had frozen Armstrong’s accounts on
Monday, September 13, when they charged him with swindling Japanese
investors of from $500 million to $1 billion dollars. Armstrong was
released that day on $5 million bail. But the Associated Press reported
that, because Princeton Economics International is incorporated in
the Turks and Calcos Islands of West Indies, Armstrong tried to file
for bankruptcy in West Indies court the following Friday. Federal
authorities got a court order to stop the liquidation, according to
the Wall Street Journal.
Armstrong’s Japanese subsidiary, Cresvale International Ltd., is expected
to close at the end of this month. Martin has denied all accusations.
At its peak Princeton Economics international and its subsidiaries
had 300 employees and offices on five continents. Earlier this year
the sponsor of an offshore fund controlled by Armstrong declared him
“hedge fund manager of the year” and touted the fund’s 60
percent return reported for 1998.
Now the fund’s Bahamas-based sponsor, Magnum Global Investments, is
closing the $14 million Princeton Global Fund and says the investors
are not subject to losses suffered by Japanese investors. Two other
funds that Armstrong managed are also closing.
But another company associated with Armstrong, Princeton Economic
Institute, is still operating. Though the publication of the monthly
“Armstrong Report” is running late, the institute’s computers
are churning out daily reports. Most institute clients get these reports
via Bloomberg terminals at a price of from $750 to $5,000 per month,
and, in spite of the turmoil, they are reportedly not canceling. Back
issues, more than three months old, are posted on the website for
free (see www.princetoneconomics.com or www.pei-int.com).
“Clients are happy to keep taking the service,” says an institute
spokesperson. “It is our intent to continue to publish our research
and bring independent and objective information to our many loyal
clients around the world.”
A charismatic iconoclast, Armstrong has written passionately about
his view that the stock market operates in predictable cycles (an
8.6 year cycle to be exact). He is said to have predicted the 1987
crash, the 1989 Nikkei crash, and the July 1998 high. By his model,
the next major turning points will be in November, 2002, and February,
2007.
Opponents to this method of prediction prefer to pay attention to
the fundamentals of a particular stock; to them, looking at cycles
is like telling the future by tossing chicken bones.
Corrections or additions?
This page is published by
— the web site for
in Princeton, New Jersey.
